CIOs getting savvy about outsourcing

IT 2011: Leaner, more flexible, less monogamous?

CIOs are playing the field in outsourcing, shunning the big providers in favour of links with smaller firms title=

CIOs are playing the field in outsourcing, shunning the big providers in favour of links with smaller firmsPhoto: Shutterstock

The recession has left its mark on the IT function - forging a leaner, more strategic and business-focused department that is less monogamous in its dealings with outsourcers, a survey of thousands of global CIOs has found.

"Today the CIO is more strategic, has a more influential voice at the top of their organisation, has a more complex range of priorities and is more global in outlook," the 2011 Harvey Nash/PA Consulting Group CIO Survey report notes. "The pace of evolution has accelerated during the recent recession with a greater burden of responsibility being placed on CIOs to contribute to major change programmes."

While CIOs are still required to control costs and maximise efficiencies to ensure their organisation has a stable platform for growth, the survey notes that the strength of focus on these two priorities is dropping. Last year the survey found almost three-quarters, 74 per cent, of polled CIOs listed cost saving as a top priority, but this year the proportion has dropped to two-thirds, 67 per cent.

"CEOs are looking to their CIO and the technology team to deliver both internal and externally focused technology innovation to help their organisation outmanoeuvre the competition and win the future," the report notes.

Driving revenue growth is now a priority for more than a third, 37 per cent, of the CIOs polled, while enabling business change is a focus for close to half, 44 per cent.

"The CIO is being asked to fulfil a more complex dual role where they have to maintain the tight cost control and departmental fitness achieved during the recession years while also ensuring sufficient technology capacity and flexibility exists to enable the organisation to pursue growth," the report adds.

When it comes to staffing, the survey found CIOs are increasingly turning to flexible labour, with most of the CIOs polled, 76 per cent, having a flexible labour component of up to a quarter of their workforce - including contract, temporary and offshore IT workers. The vast majority, 84 per cent, said they are looking to increase or maintain this level of flexibility over the next 12 months.

CIOs are also spending a greater proportion of the IT budget on outsourcing than ever before, according to the survey. Almost a third of global CIOs will spend up to a quarter of their entire IT budget on outsourced activity this year, it found, while almost half, 46 per cent, said they expect to increase their outsourcing spend in the next 12 months.

But on the outsourcing front, CIOs are playing the field, shunning some of the big outsourcers in favour of partnering with multiple, smaller, niche suppliers that can provide specialist skills to help drive innovation in areas such as mobile and cloud computing. The survey found more than a third, 39 per cent, of the CIOs expect to increase their dependence on multi-sourcing in the coming year.

On the skills side, IT chiefs are focused on...